Reaching Across Borders: Multinational Corporate Investment and Collaboration in t... | LSI Asia '25

Michael Wang (Sunmed Capital)  0:05  
Thank you Amanda, and congratulations for having a such a phenomenal event in Singapore the first time. Thank you ASI for inviting us so today, it is my great honor to moderate this panel with Chris Helen and the much younger and better lucky Michael wa so why don't we start with some self introductions, Kris, let's start with you, even though everybody knows who you are,

Chris Eso  0:37  
sure. So Chris Eso, so nice to meet all of you and welcome to Singapore. I lead the M and A function as well as minority investment for Medtronic for the broad portfolio on a global basis.

Helen Yang  0:53  
Okay, so good morning everyone. This is Helen Yang from Folsom Medtech, the Medtech division of fossil pharma, and working as the head of investment and business development.

Michael Wang (GC Venture)  1:04  
Hi everyone. I'm Michael Wang in China. I lead the venture function in Greater China for Medtronic.

Michael Wang (Sunmed Capital)  1:12  
I'm Michael Wang. I'm the founder of Summit, a capital Summit. A capital is a global VC firm focusing only on medical devices. So, so let's start with my first question here with the panel. So why should we consider cross border investment or collaboration? So do the fundamentals still support such cross border deals? Kris, why don't we start with you?

Chris Eso  1:40  
Yeah, yeah. So I'll start that, yeah, absolutely. The fundamentals still are there, right? It's about unmet need, large patient populations, and and bringing new technologies to serve those unmet needs. And so those fundamentals are not changing. Haven't changed. It's some of the obviously, you know, economics that are changing, that are, you know, constantly evolving, and so we just have to keep on evaluating and reassessing the opportunity and the size, but the under underlining fundamentals are there for for doing cross border transactions,

Michael Wang (Sunmed Capital)  2:18  
yeah. So, by the way we have a great panel today, right? Kris, you are looking from global, global perspective, from us towards the other regions of the world, right? And Michael and Helen, yeah, I suppose you are mostly looking from China's point of view, to invest across outside of China, right? So, Helen, what do you think?

Helen Yang  2:40  
Yeah, I think, you know, at FOS med tech, our mission is to bring the global technology innovation to the patient. So for sure, the cross border collaboration and transaction is still a critical driver for the progress. However, seeing a rapidly changing landscape, I think the viability of this cross border transaction should depends on the evolving fundamentals. For example, we have to be more selective on the deals, focusing on the unique technology and the high growing segments. And secondly, we have to be more adaptive, especially under some new policies in certain territories, we have to be adaptive to the new deal structures, to the pricing strategies and registration strategies, and also, I think it's more important is that we have to have a strong awareness about risk mitigation.

Michael Wang (Sunmed Capital)  3:39  
That's great. Michael, do you have anything to add? Yeah, I think the

Michael Wang (GC Venture)  3:43  
so basically, I think there are things that are changing, like in the short term, like the, you know, market and some of the policies, but there are some more fundamental changes and structural changes that are more longer term, and that makes cross border transaction being able to capture the values that you know. For example, China and us are very complementary to each other. You know, us has been very good at zero to one innovations. China has been very good at one to 10, scaling up at lower cost. And, you know, fast speed of iteration, and these two combination can work well very each other.

Michael Wang (Sunmed Capital)  4:25  
Yeah. So speaking of cross border transactions or deals, right? Last year, Medtronic acquired the Netherland company 40 medics. Right? So when you do a cross border deal, what types of deals will you consider, like a minor investment or acquisition, etc? And how do you decide when to you know, consider which type of deals right? So, can you share your thoughts from a strategic point of view or from a cooperative. Interest point of view, you know, shall we start with this time with Michael? First thing,

Michael Wang (GC Venture)  5:07  
sure. So some of the considerations, I think, one of the common consideration, whether it is from China or anywhere else, is really like, whether this is some technology that will be benefit patients, and also it is innovative and differentiated enough, and also serves the strategic priorities for Medtronic. But I think from China's perspective, we're seeing some differences, and also seeing some interesting changes recently with, you know, more of the innovations coming up and which are, you know, starting to make sense for global markets, which we're really interested in.

Chris Eso  5:55  
So, of course, you may want to add on to this, yeah, yeah, in terms of kind of the different deal structures. So so we we don't go into interactions and relationship, into a relationship saying, Oh, we're going to do this, or we're going to do that, right? We are approaching it of what is needed at that given point in time for the technology, for the company to continue to evolve. And so we're constantly looking at whether it should be an acquisition, is that a better outcome or a pathway? Is a structure transaction, a better outcome or pathway, or is just a clean minority investment to allow the company to independently grow and get the investment that they need in order to meet the overall goal and and mission that they're trying to achieve. And so we're constantly evaluating. We do things in parallel so that we can evaluate, and then, ultimately, then at the end of the the the our work, we will then determine what we think is the right Win, win solution for, not only for for the company to continue to to evolve and succeed, but also what's in the best interest for Medtronic? Is it better for us to step in and have a heavier involvement or not? And so it's ultimately coming down to, where can we add value? Where does the company need value creation and support, and can we help them? And however we can do that, that's how we'll structure it.

Michael Wang (Sunmed Capital)  7:27  
Totally. So. Helen, what do you think from, you know, you're more like China corporate venture, right? What do you when do you choose, you know, what type of you know, yeah.

Helen Yang  7:42  
So as we actually, we have a strategic money from the company, and we also have a corporate venture. So these two arms work together better. So we have different we can have very diversified deal structures. We did the minority investment, but this investment must be bounding with some China, right, like the commercial right, manufacture, right? And we did several acquisitions that that how we had our, you know, built up our medical esthetics platform. And simultaneously, we are very interested in setting up joint ventures with our partners, the out of outside China. So from the deal structure side, we keep ourselves to adaptive to all the possibilities. But the philosophy here is that as a strategic investment, we are not only seeking for the financial returns, but we have also to seeking for the strategic returns that based on the comprehensive assessment of fit and synergy.

Michael Wang (Sunmed Capital)  8:48  
Okay, so I have a kind of follow up, a question on the transaction deals, right? I mean, because we're talking about global, you know, cross border transactions, one thing we have to be careful is the regional right or country Right, right? So, such as, you know, China right or Asia, right. And sometimes those rights are not available for various reasons, right. Sometimes the targeted company may want to keep the China right? For example, you know, for them to distribute their products by themselves, right? So do you, do you see this a deal block to you? Or, you know, what's your view on the regional rights? So, Kris,

Chris Eso  9:36  
yeah, I'll can start with that one. So I get this question quite quite often, and primarily from startup CEOs looking to raise money in Asia, and whether if they took capital from an investor in in Asia and had to give up rights, either for China or for other. Uh, territories, whether that would preclude us Medtronic as a strategic to actually look at it or contemplate it, and or how would it impact our, our view of the opportunity, and my, my, my advice, 100% of the time, is look you as the CEO have to do what's right for the company at that given point in time. So if that requires you to give up rights, then so you have to right. I mean, you have a fiduciary responsibility of your shareholders and of the company to continue to to evolve the the technology and the company and grow it. And so if that is your only pathway to capital, then so be it. Then you do that. Now that means, though, that as a strategic I have to then take that into consideration and understand what that means, what rights were given up for, how long, for what duration, and what that means if I am stepping into potentially acquiring this company. And so what I've always said is the last thing I want to do is stand up in front of my board of directors and say, Look, we're going to acquire this company, but we don't have China rights, for example, that's not a good outcome for me to be able to have to communicate, but I understand that that might be required at that time. So what I always suggest, suggest is make sure that you build in some kind of mechanism to bring those rights back, so that way, when a strategic does acquire you or wants to partner with you, they have a pathway to get 100% of the rights if they so choose. And so if you have that kind of built into it, then it becomes a non issue. At the end of the day, it becomes a financial issue, but it's less of a strategic

Michael Wang (Sunmed Capital)  11:53  
issue. Yeah, I see. What about Helen? What do you think about you when you go out to, let's say, Europe or or Southeast Asia here, you know, if they want to keep the right to distribute the products in Europe, what do you think

Helen Yang  12:06  
so the two very straightforward answer your questions, if they want to keep their right, I think from for me, for us, that will be a deal breaker. But you know, for the for the regional right, I think it depends on the different companies, what there is like their short term strategy, long term strategy, some of the stat companies that they have no capability to expand to the like China or some Asian Pacific countries, so that if you leverage your strong partner in the territory that can help you to expedite your commercial pathway, and also can help you, to some extent, to increase the valuation of the company and but as Kris said, for when you want to issue this certain territory right, you have to put a set of very you know, serious criteria for this right. For example, if you have to, you know, work together with your partners in certain territory on how they can, they will fulfill this, this right? You have to set up wisdom, the milestones and the commercial the registration milestones, the commercial milestones and the like the commercial target, like for like, for the first five years, to see if they can meet the Meet the criterias, and if not, you may can, you can have some like right to retrieve this right. So you have always to protect the company, but also you have to find a way to develop so I think, is how you set the structure of this deal. Okay,

Michael Wang (Sunmed Capital)  13:44  
so, Michael, you also look at, you know, investments in China, right? I mean, if you sometimes, you do, you wanted the distribution right in China for for Medtronic, right? Yeah,

Michael Wang (GC Venture)  13:54  
actually, I think it connects a little bit to the last question, because it really depends on the deal structure and what, at what stage, you know, this company is at, versus where we are at, you know, collaborating with them. And in China, there's a lot of times where a lot of collaboration starts with distribution. So that's less of an issue, usually. And with distribution going well, we probably, you know, have a deeper collaboration along the time, but at the same time, I think the other trend that is going on has been going on for the past two to three years, which is the entrepreneurs and the investors, shareholders of these startup companies starting to be much more open towards BD collaboration and potential acquisition in the future, instead of going for IPO right as their main exit due to a variety of reasons, but it makes a lot of sense. And so I think it's really depending on you know how to be open and understand each other's needs and position. And usually I don't see see that as too much of an issue. And. Because of the time it might take for an acquisition to happen. And you know, the room there is to make sure that, you know, if there are some companies that has to distribute some of their products in certain geographies for a certain time of period, there are always ways to make it work when an acquisition happens, you know, to take that over, or things like that. And usually that's what strategics are better at doing,

Michael Wang (Sunmed Capital)  15:28  
right? Yeah. So for my personal experience, is whatever metronic force and format whatever they want. For my portfolio companies agree with them, right? So do what they want. So okay, so let me kind of pivot a little bit. I mean, we got to ask this the next question, right? So recent geopolitical environment has changed dramatically, right? We, you know, with increasing tariffs or whatever. You know, last night, President Trump said that the deal with China is down, right? So I hope it's so so has this changed your decisions to, you know, do any cross border investments, like in China, you know some, you know other areas. I mean, are you still in like a wait and see mode, or are you in that, like a by the dip mode, you know, Chris, I mean,

Chris Eso  16:23  
yeah. I mean, it kind of goes to the first question, and kind of what Helen was talking about, right? Which is, you know, if you think about the macro activities that are happening, it's constantly evolving, yeah, nobody knows what tomorrow is going to bring, like we didn't. Did anybody expect that last night they were going to solve the the tariff issues? No, I mean, because it's so rapidly changing. And so it gets back to what is the strategy that you're trying to execute on, and what is that long term vision and and, and all this is just noise right now. Now. What it does, obviously, it makes you, you know, have focus on that and think about that and factor it in if it is going to continue, and that noise is going to continue, or the tariffs are going to continue, but it doesn't change your long term kind of vision of what, what a cross border transaction is going to be. It just puts things a little bit into perspective, from a diligence perspective, from a focus. And Helen talked about, you know, prioritizing and really, kind of being more selective. So you probably end up being a little bit more selective versus completely, you know, on the sideline and stopping you're you're really focusing on strategically. Here are the key areas that I need to execute on, and I need to find a solution for. So that's where I'm going to focus. And then some of these other ones maybe are less strategically important today, that you can then kind of pause on those and re deploy your your focus somewhere else.

Michael Wang (Sunmed Capital)  18:03  
I see, I see So Helen, when you look at say, in, you know, investment opportunities in us, are you still, you know, keep continuing your pace, or are you slowing down?

Helen Yang  18:15  
Yeah. So there's no doubt that many of the innovations came from the from Israel and the United States. So we still keep looking into the opportunities in the United States, but we feel that it's not our issues. We have no issues in making deals with the US based companies. But some of the companies that was is from the United States. They have concerns to working with Chinese because they are sometimes they, I was asked some questions here, you know, if we take your investment, maybe that will have the influence in the future round of our investors, because they, we don't know how they will evaluate this situation. If we have some Chinese shareholders in our company and and also have one time that the company said, you know, we really want to collaborate you and especially in the China market, but we are building for, you know, we have a short plan for IPO in the United States. I'm not sure if your participate will influence this result. So I think it's because of the changing dynamics has making this deal very complicated. So I think the opportunity is still there, but it set a lot of barriers and more challenges in make this deal happen. So we now change more focus to transfer to Europe and Israel. I believe there are still some startups that we can collaborate at the very early stage.

Michael Wang (Sunmed Capital)  19:48  
Okay, okay, anything to add? Michael,

Michael Wang (GC Venture)  19:50  
I think, to Helen's point, I think in the long term, you know, the relationship between China and us is challenging. So regardless of the short term for. Utilities companies need to be build the resilience that it needs from the point of view of supply chain technology capabilities in China and in the US and I think at the end of the day, it really boils down to the value of the asset, right? If you have a good group of concentration of value of in a valuable asset, that makes sense for your company, why not? And at the end of the day, science is science, right? And and disease is disease, right? So whatever works in China might work, might very well work everywhere else. And today I'm seeing a lot of discrepancies, or, you know, diverging paths that different companies are taking regarding to China. And I think this is a moment in time where it will it might make a lot of difference 510, years after, when you look back, and a lot of company that chose to, you know, to separate, might regret, but there's no way coming back. And if we look at biotech, it's has been really clear, like recent years, right? The number of deals in China has been consisting of, like, 1/3 of the global deals, and for this year alone, it is almost 50% and that is really some amazing changes. But that's happening on top of the decades of investment and dedication of entrepreneurs in China, med tech is lagging behind a little bit. I think it's probably like three to five years lagging behind, but I think it's catching up. It's going to be more complicated with regards to, you know, tech transfer, manufacturing, know how market education, things like an IP which is going to be quite challenging for a lot of cases, but I think it's the day is going to come, maybe not for all of the assets, but at least a part of it that will make sense for global so why not do that?

Michael Wang (Sunmed Capital)  22:08  
Okay, okay, that's good to know. So maybe you know for the audience, right? I mean, in like one or two sentences, can you given some advice for doing any cross border deals? Chris,

Chris Eso  22:25  
yeah. I mean, I think any deal, even even you know domestic deals, but, but more importantly, cross border deals invest early in building trust and that relationship, because that's what will bring you through to the finish line in all of the ups and downs and the noise and the turmoil is that trust and that foundation. It's obviously more important cross border because of the cultural aspect of it. But also, you know, you know some of the comments was about, it's around the right time, and sometimes you might want to do a transaction, but it's not the right time for one side or the other, but you are building and establishing that relationship that maybe in the future it will evolve. And so I know that wasn't one sentence, but to me, it's around, you know, investing early in trust and the and the relationship,

Michael Wang (Sunmed Capital)  23:25  
yeah, Helen

Helen Yang  23:26  
I want also to echo Kris as that. It stays cross border transactions. It's all about building trust. But building trust is start from like so the building first the connections and understanding, and all the trust is based on understanding. So from the many cross border deals that we have learned in fosa med tech that the cross border collaboration is not about erasing differences, but about to engineer new DNA together with our partners.

Michael Wang (Sunmed Capital)  24:03  
Okay, Michael, anything.

Michael Wang (GC Venture)  24:06  
I think both of you said it perfectly. Think maybe just transparency is also important in building the understanding to gain trust along the way. Okay,

Michael Wang (Sunmed Capital)  24:17  
so we still have some time left. I don't know if we are open for questions from the audience.

Chris Eso  24:34  
Maybe we'll ask you as the moderator, what do you think about cross border transactions?

Michael Wang (Sunmed Capital)  24:38  
I think you know it for for us. I mean, we invest both in US and in Asia, right? I mean Singapore and China. I think you know the technology, the Omid. You know, first of all, let's start with unmet clinical needs, right? It's a universal, right? It's not. It. You know, some amend needs in China is similar to how many needs in us or some other regions, right? So when we look at innovations like, say, in us, we always think about, you know, can we transfer that or leverage that to help the patients in China or in, you know, in Asia? So I think even though we are having some challenges, you know, geopolitically. But you know, I think it's, you know, just short term disturbance, right, once that you know, if we, if we look at for the long run, you know this, these type of cross border transactions should continue, and you know, for the sake of patients around the world, we should continue to do that. So that's how we see it, and that's how, you know, we operate as we look at global opportunities. So very good. So

Helen Yang  25:58  
can I, yeah, can I have a question for you? Kris, sure. Okay, so, you know, we have a very innovative technology in China that week. We actually, we incubate so like a lung cancer therapeutic device. So we now attract many attentions from the United States and including the BD sector from Medtronic. So, but we want to keep the China right here in China for the China commercialization, but we are willing to collaborate with the US companies to, you know, license this right in the United States. So do you think it's a, still a wearable deal structure for Medtronic?

Chris Eso  26:39  
Yeah. I mean it, it's interesting that you, you raise that, because that is becoming more and more a request that we're hearing is the the kind of local China company wanting to own its own rights, continue to commercialize it there, but then wanting to partner with with multinationals, for Europe, US, you know, Japan, et cetera. And, yeah, I mean, it's something that we absolutely will evaluate and look at and see what's the right way that we would think about that. What we tend to want to do, though, is have a global portfolio, and so having a competing product in one region versus another region becomes a little bit more challenged. And so usually what we would want to do is do some kind of joint venture in China or wherever it is for that jurisdiction, and then get the rest of global right so that we can have the portfolio effect on a global basis.

Helen Yang  27:43  
Okay, thank you.

Michael Wang (Sunmed Capital)  27:45  
I think there's a question from Yuval,

Chris Eso  27:52  
can we get a microphone or we could repeat it, I guess, up here in the front, yeah, middle.

Audience Question  28:05  
Thank you for very good discussion about the whole concept involved in cross border deals, but I was missing one key question, why on earth you want to do a cross border deal? Why? What's the reason? Because everything else is driven by why to do it? My view, I am curious to hear the pilot opinion. My view is, you want to tap into innovations all over the world. The best remember, we are patient driven to put aside money and profits. We are patient driven. So if there is a great innovation come out of Papua, New Guinea or some, I don't know sure we want to tap it and to make it International, but maybe there's other reasons. So why should we do the whole thing? Of course, in getting involved in this complexity, which now increasing is all these grand politics and anti collaborative, anti collaboration and anti globalization. So I would like to hear your opinion.

Chris Eso  29:13  
Yeah, I could. I can start with that one. So I kind of boil it down to two main reasons why you do cross border. One is innovation, like you were talking about, there's some unique innovation that we haven't seen somewhere else and and it's been addressed, and it will address a large patient population, not only in that jurisdiction, but on a global basis. The other is speed to market in that country, or access to that market in that country, where it typically what a strategic would look at. Take China, for example, usually that's been the last country that we look at to go. To market to because we'll want to do US, Europe, Japan and then China. And obviously the rest of kind of Southeast Asia kind of falls into some mix of either China, Europe or US data. And so we tend to put that towards the end. And so by partnering or doing a cross border deal with somebody, does that accelerate and move China, for example, earlier in the commercialization, which means we had to to service those patients in a much earlier time point than what we would have typically seen in our own kind of development cycle. So those are the kind of the two main reasons that I see that we look at, I don't know if there's others that you guys think about,

Helen Yang  30:46  
yeah. So first is the patient. So we'll as we, as I mentioned, we want to bring the global innovation to our patient. And also, I think the another driver for cross border deals is to to learn about the different cultures to help us to make our own business globalization. But another point I have in my mind is that that the two, I think the cross border deals, can also help to advance the treatment or the technology in the treatment side. And because, for example, some of the Chinese physicians are very well, are more experienced in doing certain procedures, that we can leverage these, their their experience to, you know, to advance the whole therapeutic areas, that is One of the beauties for the cross border transactions.

Michael Wang (GC Venture)  31:43  
Yeah, I think to basically the possibility to leverage what different countries and geography is good at, right? Because usually there are differences what they are good at. And, for example, in China, the speed of iteration, the cost structure that might actually work well, not only in China, but for a lot of other countries in the world, which is making a lot of sense, and therefore, at some point, may be a differentiated solution for different geographies.

Michael Wang (Sunmed Capital)  32:15  
Yeah, that's great. I don't have anything to add, so I want to thank the panelists. This was a very insightful discussion, and I hope the audience can get some takeaways when you consider in you know, cross border deals. Thank you.